The next two or three years are likely to see fundamental changes as a rash of prestigious subsidised schools switch to the Direct Subsidy Scheme (DSS).
Their predicted move - aimed to ensure that they can continue to select top students - follows last year's scrapping of the Academic Aptitude Test and reduction in the number of secondary bands from five to three.
In fact, the move has started already. St Paul's Co-Educational College, a subsidised elite school in Mid-Levels, took the lead last week by announcing that it would convert from aided status to DSS in the next academic year. The school contends that the new secondary school places allocation has led to a wider gulf in students' abilities. It is reacting to the fact that DSS offers a lump-sum subsidy for private schools while allowing them great freedom, such as the right to exercise full discretion in student intake, establish curricula and set fee levels.
Its proposed fees range from $48,000 to $60,000 a year - higher than tuition fees charged by local universities. But the school has said that up to 30 per cent of students would receive a full remission on their fees.
Other elite secondary schools such as St Paul's College, also in Mid-Levels, Diocesan Boys' School in Mongkok and Wah Yan College (Hong Kong) in Wan Chai are considering switching to the DSS. Rosalind Chan Lo-sai, chairwoman of the Grant Schools Council, which represents 22 elite schools, said she expected more member schools to make the move in the near future.
So why the change? The readiness of some of Hong Kong's most famous schools to switch to non-profit-making DSS status stems from their dissatisfaction with reforms. "Education reform is leading to mediocrity. It is increasingly difficult to maintain quality education for upper-end students," Ms Chan said.
But the Government has offered an olive branch to elite schools through the DSS system, to give them greater independence while implementing change. This, according to Director of Education Matthew Cheung Kin-chung, would give middle-class parents more options in the type of schooling available in Hong Kong, and an alternative to sending their children to international schools or overseas.
The background to this is that while education reforms have attempted to make schooling fairer and reduce pressure on primary children in their competition for the most sought-after places at secondary level, members of the Education Commission and Education Department consistently defended the need for elite schools. But some educators have cautioned that any move to make the most desirable schools fee-paying institutions could reduce access for less well-off students.
Cheung Man-kwong, the legislator representing the education constituency, said the Government was promoting DSS schools in the hope of pleasing the middle classes. He expressed concern that students from low-income families would be deprived of the opportunity to go to these schools because their parents were too poor.
The DSS scheme was introduced in 1991 following an Education Commission recommendation that alternatives to the government and aided sectors should be encouraged. Schools operating under the scheme enjoy greater flexibility and autonomy than public-sector schools.
The amount of government subsidy they receive is linked to the number of students admitted, with subsidies of nearly $30,000 allocated for each pupil.
There are 34 DSS schools at present, of which 32 are secondary and two are primary. Four international schools are also included under the classification, including Hong Kong International School and the Chinese, French and German Swiss international schools. Li Po Chun United World College is also included.
Mr Cheung acknowledged that he was confident that a number of aided schools would switch to the scheme in the coming two or three years. "Several schools with long histories are now seriously considering this," he said, adding that he did not rule out the possibility of some top government schools also switching to the scheme in the long run.
The Government revised the scheme in June to lure more schools. Under the revised format, a DSS school can receive recurrent government subsidy of about $29,500 per student if its tuition fees do not exceed $68,864 a year. The package is made more attractive by allowing them also to receive their existing aided subsidies during a five-year transfer period. Currently, subsidies are progressively reduced when fees exceed by one third the average cost of a junior secondary place.
While the majority of pupils are fee-paying, schools must set aside about half of the fees collected for funding scholarships or financial assistance schemes for needy students.
DSS schools are often confused with the new Private Independent Schools. The latter are allocated land and grants to build their own schools but are not entitled to receive any ongoing subsidies.
Since last year, the Government has allocated 15 sites to new DSS schools. Mr Cheung said 24 would open by the 2005/2006 school year.
Some of the new DSS schools are grasping the opportunity to be innovative with their curricula. For instance, HKMA David Li Kwok Po College in West Kowloon, which opened last year, plans to offer the International Baccalaureate programme. "As a DSS school, we enjoy greater flexibility in curriculum design," the school's education officer, Wing Leung Yan-wing, said. "We emphasise project learning and continuous assessment. For students between Secondary One and Three, final examination results only account for 30 per cent of their marks in the school year."
Its tuition fees ranged from $9,000 to $23,500 a year. Most students were from middle-class families, he said.
St Paul's College, an all-boys school except in the sixth form, was the first of the elite aided secondary schools to join a pilot DSS scheme in 1992. It left one year later because of the Legislative Council's opposition to the plan. The school's principal, Timothy Ha Wing-ho said, said last week's decision by St Paul's Co-Educational College would serve as catalyst for other elite schools to switch to DSS status. "Our school has no definite timetable at the moment. But if it is going to happen it should do so quickly," he said.
He said his school's experience in the pilot year had been encouraging. "We had full discretion in our admission of Form One students. With class size reduced from 40 to 35, students were more active and teaching quality improved markedly," he said.
The fact that government and aided schools are no longer allowed to admit students based on competitive entrance tests and examinations, while DSS schools are exempt from such rules, is making a key difference in attracting elite schools to the scheme.
Diocesan Boys' School, an elite secondary school in Mongkok, had considered switching to the scheme since last year. Headmaster Terence Chang Cheuk-cheung sees several benefits from such a move. "We would enjoy full discretion in the admission of students. We can also offer a better quality education because school fees can be charged," he said.
Mr Chang added that it was imperative to consider such a move now that the school was faced with a wider range of student ability because of the new allocation process.
"The reduction in students' banding had definitely posed a challenge to teaching quality. It may compel some prestigious schools to rethink the necessity for switching to DSS," he said.
But Mr Cheung said the results of this year's secondary school allocation showed that standards in 70 per cent of schools were largely the same as last year's, dismissing fears that elite schools were threatened by mediocrity.
Ip Kin-yuen, lecturer in the department of educational policy and administration at the Institute of Education, said the tuition fees proposed by St Paul's Co-Educational College were high.
Mr Ip said that the Government was subsidising the DSS schools with public money and that such schools constituted unfair competition for their public-sector counterparts. "The lower classes will consider that education is no longer an effective means in fostering social mobility," he said.
But Mr Chang stressed that selecting students of higher academic calibre was not the major reason for switching to the DSS. "We hope we can offer an alternative curriculum and reduce the class size from over 40 to 30 with the additional financial resources," he said.